Help - tenants taking me to VCAT

C

cails

HI All,

I would appreciate any advice or knowledge those of you experienced in being landlords could provide me.

The situation:
In June this year whilst overseas my PM contacted me to say the current tenant of my 3 bed property felt he could no longer afford the rent. I appreciated his honesty and agreed to break the lease with one months notice.

The property was advertised and 5 days later I had another email saying a couple had applied and wished to "take" the property. I asked about their situation and agreed to lease to them.

On a Friday the original tenant moved out and I had an email from the PM (who left in sudden circumstances the same day!) saying all was fine with the property. The following Wednesday the new tenants took possession and immediately sent the new PM a list of items that were broken and their main complaint was it was not clean. I visited the property with the PM and agreed that some elements were not appropriately cleaned by the prior tenant (oven, shower etc). He came back and cleaned them as he did not want to lose his bond. I arranged to have door handles, dishwasher etc repaired (the prior tenant had not reported these).

Well 3 days later, the new tenants contacted the PM and asked me to break the lease. I replied that I would not, unless they paid the re-adevertising and other costs and therefore they said they would proceed with a VCAT application.

They are applying under the following conditions:

- not being supplied with the appropriate paperwork (copy of lease?) within 14 days;
- the property not being reasonably clean on occupancy;
- not requesting rights to access the property (i presume this relates to the inspection of their complaints).

I am struggling to know what to do. My PM says not to worry they will attend VCAT etc but I would suggest that the complaints are actually the fault of the PM, i.e. not supplying paperwork, not conducting a proper final inspection and not requesting access. So are these really the best people to represent me?

Therefore any advice on what I should do would be very much appreciated. I pride myself on having a decent property and keeping it in good repair and I am trying and failing ;) not to take it personally.

Is a VACT application and judgement made against me or the PM? i.e. am I going to be liable even if they were incompetent.

Thanks, sorry so long!

Kind Regards.
Jess
 
Sounds like the tenants found somewhere better and want to move there instead, and think that a contract is just a trifling inconvenience which does not need to be adhered to.

From where I am sitting

1) They would have been given the lease at the signing? And how can they say they didnt receieve it within 14 days when they are less than 14 days into their lease?

2) Property was inspected and leases typically note that the property is leased in the condition as inspected unless otherwise noted. They identified it was not clean enough (despite it passing outbound and inbound inspections), the PM addressed it and it was cleaned.

3) You attended with the PM. So long as the PM entered with an arranged time, you do not have to make any other special arrangements or notify them you are attending.

At most they might be entitled to a reduced rent for the days when it was not clean enough.

Let your PM handle it. Let the tenant go to VCAT, make a fool of themselves, and collect your rent.

Just be prepared for them to be high maintenance/PITA tenants for the duration of the lease.
 
DaveMSydney said:
Sounds like the tenants found somewhere better and want to move there instead, and think that a contract is just a trifling inconvenience which does not need to be adhered to.

From where I am sitting

1) They would have been given the lease at the signing? And how can they say they didnt receieve it within 14 days when they are less than 14 days into their lease?

2) Property was inspected and leases typically note that the property is leased in the condition as inspected unless otherwise noted. They identified it was not clean enough (despite it passing outbound and inbound inspections), the PM addressed it and it was cleaned.

3) You attended with the PM. So long as the PM entered with an arranged time, you do not have to make any other special arrangements or notify them you are attending.

At most they might be entitled to a reduced rent for the days when it was not clean enough.

Let your PM handle it. Let the tenant go to VCAT, make a fool of themselves, and collect your rent.

Just be prepared for them to be high maintenance/PITA tenants for the duration of the lease.
Click to expand...

X2, well said.
 
You might be better off letting the tenants break the lease. Sounds like they are doing you a favour by trying to get out of the lease.

Do you really want these people living in your investment for the term of the lease? Even if you win, you may loose in the long term. What will the tenants do to the property if they are forced to stay? Will they pay rent? Etc etc.
 
Hi Dave,

Your response was much appreciated. I was beginning to wonder whether I was losing perspective and being unreasonable.

The PM did mention that she felt that the tenants "changed their minds" and I received an email from the PM saying they had found another property.

Pickle, I do understand the issue of maybe it is better long term to release them BUT haha I suppose I am stubborn. Unfortunately my property is in outer Melbourne and therefore not as quick to rent, I would estimate 3 weeks on average, so adding the lease amounts and advertising I would be looking at around $1500-$2000 by allowing them to break the lease. This might not seem like not a lot of money for some and whilst I can afford it, something would have "to give" in regards to my family and I am not so sure my family should do without because 2 people have a change of heart and don't realise a lease is a legal agreement.

I have asked my PM for a full copy of the VCAT complaint as I am yet to see it, and have only been informed of the clauses.

Should I attend the hearing (even if I say nothing)? or leave it entirely to the PM?

Kind regards
jess
 
cails said:
Should I attend the hearing (even if I say nothing)? or leave it entirely to the PM?
Click to expand...

Let your PM do what you pay them to do. You being there will have no bearing on the outcome.

If the tenants have admitted to the PM that the real reason is that they want a different house and not that you or your property are really the issue, there is a high chance of it going in your favour.
 
Sounds like the agency I used - can I ask where they are based (PM me if you prefer) I had a nightmare with an agent not following protocol and whilst the tenants were partly to blame I think the agency didn;t help and we were left with the costs
 
Hiya Jess,

I would be charging the tenants lease break fees regardless - pro-rata letting, advertising and all rent until a new tenant is found. That's the way it goes and as long as you do all you can to re-lease the property in a suitable time frame VCAT will rule the same - I have been to VCAT for a similar situation and the member basically said to the tenants "that's what you get for pulling out of a legal contract". Pickle, FWIW the tenant cannot be forced to stay, but can be forced to pay lease break charges.

It gets a little harder when your old PM up and left though. When you inspected was the property dirty? Think, would you have moved in?

The paperwork - did the agent sign the lease on you behalf, or was it posted to you to sign? Many agencies, including my company, ask landlords if they will allow a representative of the company to sign the lease on their behalf. That way the leases do not leave the office and the tenants have received all paperwork when they should.

Access to the property, was this verbal or via letter/email? How much notice was given? It should be 24 hours written notice, however in this type of situation it sounds like it wasn't.

Sounds to me the tenants have changed their mind and are trying to get out of the lease without needing to pay anything. In saying this, it sounds like your PM has stuffed up too.

VCAT is also a ruling against you as the landlord, and not the agency, but if the PM has stuffed up you can take it up with the agency after the VCAT hearing (assuming you would be out of pocket for their negligence) for compensation.

Hope this helps!

Sam
 
We always have a few tenants every year, who do the same.
The last property we bought a month ago, we are already on our third tenant.
The first day we showed it we had 2 applicants. An elderly woman, who needed a bigger place quickly and a single dad, who had his children on the weekends.
We always take the first acceptable tenant, which is the woman.She moved in..loves it. Her children have talked her into going to a seniors care home.
We start looking for a new tenant.
I call back the single dad..he wants it.Pays his bond, and all is good.
He calls yesterday, says his circumstances have changed and wants out.Can he have his bond back, he asks.
Sure, if we secure another tenant.
It is on the market again...

Seems like tenants think a rental lease, really doesn't count as a contract.
Oh well, that is part of the game.:)
 
Hiya Sam,

It gets a little harder when your old PM up and left though. When you inspected was the property dirty? Think, would you have moved in?
- My first hint there was any problem was when the PM sent through the list of complaints at which time I went with the PM to the property. Some elements I did think were not appropriate and should have been cleaned by the prior tenants. This was rectified in 2 days, other items I agreed to have cleaned (e.g. cobwebs from high ceilings, cleaning of exhaust fans) as well as fixing some broken items. All this was completed asap.

The paperwork - did the agent sign the lease on you behalf, or was it posted to you to sign? Many agencies, including my company, ask landlords if they will allow a representative of the company to sign the lease on their behalf. That way the leases do not leave the office and the tenants have received all paperwork when they should.
- when the tenant signed I was overseas. I actually signed the day after the tenants moved in :S. I never saw the agreement until that day. I was never mailed to be or scanned etc.

Access to the property, was this verbal or via letter/email? How much notice was given? It should be 24 hours written notice, however in this type of situation it sounds like it wasn't.
- I asked to attend the property to go through the list, rather than sitting talking about in the PM's office. I presumed the PM went through the appropriate channels....I am now beginning to wonder!!!!! :S

Sounds to me the tenants have changed their mind and are trying to get out of the lease without needing to pay anything. In saying this, it sounds like your PM has stuffed up too.
- completely agree!!! Whilst I think the tenants are looking for any excuse, I think the agent has given them the means to hang me with :(

VCAT is also a ruling against you as the landlord, and not the agency, but if the PM has stuffed up you can take it up with the agency after the VCAT hearing (assuming you would be out of pocket for their negligence) for compensation.

- Thanks! this helps so much. I am just wondering why I am paying an agent at this moment in time if they are not being diligent and following process. *sigh* only had these properties for 18 mths, but you live and learn :)

Thanks again Sam :)

Kind Regards,
Jess
 
Oh geez Kathryn, you have the patience of a saint! Are you saying you keep letting these people break the lease agreement without any penalty??

Kind regards,
Jess


kathryn d said:
We always have a few tenants every year, who do the same.
The last property we bought a month ago, we are already on our third tenant.
The first day we showed it we had 2 applicants. An elderly woman, who needed a bigger place quickly and a single dad, who had his children on the weekends.
We always take the first acceptable tenant, which is the woman.She moved in..loves it. Her children have talked her into going to a seniors care home.
We start looking for a new tenant.
I call back the single dad..he wants it.Pays his bond, and all is good.
He calls yesterday, says his circumstances have changed and wants out.Can he have his bond back, he asks.
Sure, if we secure another tenant.
It is on the market again...

Seems like tenants think a rental lease, really doesn't count as a contract.
Oh well, that is part of the game.:)
Click to expand...
 
Not that it helps you at all, but this is why they real estate agencies in Perth request one-weeks rent with your application for a rental property. If you're successful, it gets credited towards your rent, but if you're offered the property and then change your mind (even if you haven't signed a lease) then you forfeit the payment.

This system totally sucked as a prospective tenant, as you could only ever submit one application at a time. But as a landlord with a Melbourne property, we've lost out on rent by people saying on a Friday they'd take the property, only to change their mind by Monday morning. Leaving the weekend in between a completely wasted opportunity to show it to other prospective tenants, and costing us at least a weeks worth of rent. So it's a great system from that side of the fence!

Anyway, good luck with the VCAT hearing. I hope it goes in your favour.
 
cails said:
Oh geez Kathryn, you have the patience of a saint! Are you saying you keep letting these people break the lease agreement without any penalty??

Kind regards,
Jess
Click to expand...

Our rentals are in Canada.
The most we are permitted to keep is $25 for the preparation of a new lease, if there is no vacancies between tenants.

If we are not able to secure a tenant, and they give us written notice they are not moving in, the most we would be entitled to is about 6 weeks rent.
In our province, the bond is only permitted to be 1/2 months rent...which isn't enough.

If they sign a lease before moving in..instead of the moving in day...we can require payment for the length of the fixed term...but try collecting it !!!


Today was a happy day for Rob, my husband. We personally served 2 former tenants to appear at a tenancy hearing. The look on their faces is priceless.
So many tenants think that last month of rent is optional here.
 
The lease within 14 days is a matter of them receiving a fully signed copy of the lease. They receive a copy which has not been signed by you or on your behalf on the day of sign up and under Vic legislation you are allowed 14 days to provide the tenant with a copy of the lease which has been signed by you or on your behalf, has your PM been instructed to sign these on your behalf or have these been forwarded to you?

In regards to the property being reasonably clean - it would have to have been in a very bad state for them to claim this as the residential tenancies act does literally use the term 'reasonably clean' the fact that the tenant went back to clean items which were found to be in a condition that wasn't up to standard would suggest that this item had been adhered to.

In regards to access? If it was at a time which was arranged with the PM and the tenant they can not complain, the tenancies act also requires them to 'allow reasonable access' so if they have maintenance or complaints it is required that they allow access for these things to be carried out and inspected. At no time during the inspection did you complain about their keeping of the house and you were simply entering the property to try to meet your legal obligations as a landlord - very good!

Let them go to VCAT, they seem to be viewing the contract as an inconvenience and nothing more, I would be surprised by any member who found in the tenants favour given the circumstances.

The judgement is not against a PM but against you as the owner, likely the only penalty which would apply would be not supplying the tenant with a fully signed copy of the lease within 14 days. You could of course chase up this amount from your PM as it is a law which they are aware of and should have spoken to you about.

Also, have your PM diarise a date to look at sending the tenants a 90 day notice to vacate that their lease will not be renewed and they need to vacate, just in case they do turn out to be a real headache.
 
Sez said:
The lease within 14 days is a matter of them receiving a fully signed copy of the lease. They receive a copy which has not been signed by you or on your behalf on the day of sign up and under Vic legislation you are allowed 14 days to provide the tenant with a copy of the lease which has been signed by you or on your behalf, has your PM been instructed to sign these on your behalf or have these been forwarded to you?
Click to expand...

in qld you are required to give the tenants an RTA booklet on their rights (there might be the odd responsibility in there too? no, that's asking too much.) at the start of the tenancy. is vic similar? perhaps that is the documentation they are complaining about? how does the tribunal view a failure to give a rights booklet (if required in vic)?
 
A statement of rights and duties is required to be supplied to the tenant on the day they sign their leases (a red booklet made by Consumer Affairs), a fine of $500 to the agent is imposed if it is not. This is a different issue to the actual signed lease paperwork though and from what the tenants are lodging their application on I believe that they are talking about a fully signed copy of the lease. :)
 
Sez said:
A statement of rights and duties is required to be supplied to the tenant on the day they sign their leases (a red booklet made by Consumer Affairs), a fine of $500 to the agent is imposed if it is not. This is a different issue to the actual signed lease paperwork though and from what the tenants are lodging their application on I believe that they are talking about a fully signed copy of the lease. :)
Click to expand...

ok. it's green in qld (yes we're carbon neutral up here. lol.).

the op says 'not being supplied with the appropriate paperwork (copy of lease?) within 14 days'. could this be the red book or even the condition report? i'm sure you know the rules and time-lines but perhaps the tenant doesn't?
 
All of the paperwork needs to be supplied on sign up and the only thing which is left at 14 days is the fully signed lease which is I think why we all make that assumption. :).

Unfortunately tenants who pull these stunts are USUALLY reasonably well informed by way of the tenants union (who I have had some disagreements with due to them supplying incorrect information). If the tenant is confused and has the wrong paperwork that is good because then the member hearing the case with throw it out right away!

We can only hope the tenant doesn't know what is going on and the PM does :)

(Our book is red, it goes faster [?]).
 
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